F. Scott Fitzgerald once said there are no second acts in American lives. However, after having spent 20 years in the IT industry, serving in various roles from system administration to network engineer (10 of which have been in education), I’ve recently decided that my second act should be as a freelance writer covering the investor's view of the technology industry. My background in engineering gave me what I consider strong analytical skills. My 15 years of trading and investing gives me the experience to assess equities and appraise their value. I am a Warren Buffett disciple that bases investment decisions on the quality of a company's management, its growth prospects, return on equity and price-to-earnings ratio. I employ conservative strategies to increase capital while also keeping a watchful eye on macro-economic events to mitigate downside risk.

Why Apple Should Hang-up On The iPhone, iWear Is Next

Aside from some end-of-year tax selling and concerns regarding the fiscal cliff, shares of Apple took a brutal beating towards the end of 2012. The reason – there is a broad belief that the company no longer knows how to innovate. But it’s not true. Instead, what has hurt Apple has been the complete opposite.

The company’s 6-month refresh cycle and avalanche of products seems to have backfired – allowing rivals such as Google and Samsung to steal market share. Apple’s “misdirection” with its disappointing map app didn’t help the situation either. For this, CEO Tim Cook offered an apology.

Consequently, Apple now finds itself in an unfamiliar territory – having to prove itself. Aside from whether or not the company still deserves its status as a market darling, investors want to know what’s next? Apple has the answer – it’s just not saying.

However, for the company to truly move forward as a tech power, Apple should hang-up on the iPhone after one more iteration – presumably the iPhone 6. You might disagree. Granted, the phone is still selling well. However, aside from a different chip and larger screen, the change from the 4S to iPhone 5 was not that significant.

Also, what can Apple add to the iPhone 6 or “5S” that would be appreciably better than the current version? In other words, I don’t think the company wants to go down this line – feeling pressured to excite the Street with each new iteration, especially since margins are beginning to decline. Besides, where will it lead – to the iPhone 10? And then what?

Also, for quite some time, the company has hinted on wearable technology. “It’s time” for the iWatch or its iWear line of devices. This is an area in which Google has already shown interest. And for Apple, this will be the answer to that chronic “what’s next” question. And the company will finally be able to put to rest that other annoying question – can it still innovate?

Post Your Comment

Post Your Reply

Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out.

Comments

Unless this wearable technology is going to successfully substitute watches, wallets and more, I don’t see an easy barrier of entry. Wearable technology is one thing. Wealth status is another. You’re venturing into a territory that is dominated by many conspicuous products that are treated as a point of juxtaposition which uniquely defines the person. Their glasses, their watch, their pocketbook/clutch/wallet. For example, I have a few watches which I wear. I wear these watches not only for practicality but to display my supposed social status. Unless this new “iwatch” is going to cost me 1,000 dollars, it is honestly not going to appeal to me in terms of helping me attain the goal of wealth status.” Listen, it sounds cute to check your wrist for a facebook update or whatever, but honestly, stop introducing products that is just conspicuous consumption and make people less productive. Because believe me, we don’t need more devices that operate electronically to stick with us. Pretty soon, a thief can steal a phone, tablet, and a new iwatch all off of one person.

Kevin, I didn’t say it would be meant for everyone. Are you suggesting that Rolex and Mercedes should have never existed because their products are restricted to “wealth status?” Wearable technology is inevitable. Apple will be the leader of that market. You already know this.

YOU know I don’t already know this. LOLS. Because Richard, if I knew this, I wouldn’t have written the previous response. So, yes, you shouldn’t tell me things that you assume I know already. I don’t know whether Apple will be the leader in this market solely for the fact that they HAVEN’T PUT OUT A SINGLE PRODUCT NOR HAVE THEY EVEN MENTIONED ANYTHING IN THEIR PRESS RELEASE RELATED TO THIS. But you know what firm I think will have first mover advantage, GOOGLE. GOOGLE GLASSES. WHAT PRODUCT does Apple have? What product has Apple put out or what press release have they provided to the public to show their interest in wearable tech? Last i remember, Google did it. Not apple richard. GOOGLE.

http://www.youtube.com/watch?v=MP1gvGcXcLk

Watch in awe Richard. This happened in June. Email me when Apple comes out with some news flash. I expect the email in a few months at best. In the mean time, have fun looking at how AWESOME GOOGLE GLASSES is.

Really? How much research on McDonald’s do I need to do to say that it will outsell rivals in hamburgers over the next couple of years? I’m also going to predict that Coca-Cola will remain innovative in the beverage industry. Do I really need to first research Vitamin Water to make that statement?

Yes you do. Stop asking yourself whether you should consider these seemingly simple questions. Of course you must answer all of these questions. You think that by skipping them, you’re doing yourself a favor by saving time or something?

“I’m also going to predict that Coca-Cola will remain innovative in the beverage industry. Do I really need to first research Vitamin Water to make that statement?”

So if I change your argument around to

I’m also going to predict that “Apple” will remain innovative in the technology industry. Do I really need to first research “Google” to make that statement?

Yeah, considering Google has consistently proven itself to stay ahead of innovation by securing the autonomous driving patent, along with Google TV, as well as Google Glass, I’d better DAMN make sure I better research Google before I come out with a statement as outlandish as “Apple will be the leader of that market. You already know this.”

Because believe me Richard, if you were to tell me that Mickey D’s is going to outsell without having to do research, I’d NEVER ever come to you for financial advice. Hell, you don’t even want to do the most simplest research. You couldn’t even give me a few numbers if I had asked you to because you don’t think doing in depth research on such a simple subject is worth it.

Kevin, here’s a suggestion – write an article to counter my points. Better yet, make sure it pokes holes in my claims and answer every question that I’m “skipping over.”

These are my opinions – nothing more, nothing less. Once you realize that you will see that the world is not so bad. But one thing that I won’t do is answer every question that is posed to me by those that disagree with my articles. I just don’t care enough.

I’m sure that by writing in the responses column, not only is it more efficient for the ideas to be passed between one another, but also more can be done in the time.

I just want to clarify something as so all readers can read this comment. Are you telling me that as a contributor, you don’t conduct the simplest research such as answering these questions?

” How much research on McDonald’s do I need to do to say that it will outsell rivals in hamburgers over the next couple of years? I’m also going to predict that Coca-Cola will remain innovative in the beverage industry. Do I really need to first research Vitamin Water to make that statement?”

If the answer is no, which it appears to be from the way you wrote these questions, I’ll have a better understanding towards the methods in which you write.